By law, the Knesset can waive the three-week grace period after the president determines that he cannot find a party leader who can form a viable government.

If the Knesset passes the legislation Monday afternoon, elections could be held as early as Jan. 27.

According to Israeli media reports, Kadima MK Tzachi Hanegbi plans to ask outgoing Prime Minister Ehud Olmert to allow Livni to replace him as head of the transitional government to bolster her position during the campaign.

Meanwhile, Knesset speaker Dalia Itzik (Kadima) is researching the legalities of dissolving the Knesset in the first week of the winter session, while urging legislators to refrain from voting on issues related to the 2009 budget until after the election.

Kadima MK Menahem Ben-Sasson also called on party leaders to pass legislation this week to dissolve the Knesset and set a date for elections.

"There's no point in waiting three weeks before the election recess," he said. "Campaigning economics will thrive during this time and irresponsible Knesset members will pass unrestrained budgetary laws."

According to one source, the three-month campaign carries up to a $2 billion shekel (nearly $520 million) price tag to the Israeli economy in direct and indirect expenses.